China growth forecast to slow to 4.5%

China's economic growth is forecast to slow to 4.5% year on year in second-quarter data due Wednesday, according to the median estimate in an AFP survey of analysts.

The forecast would mark a slowdown from 5% in the previous quarter, while still leaving the economy on track for the government's annual target of 4.5% to 5.0%.

The world's second-largest economy remains under pressure from a long property-sector slump and weak consumer demand. Analysts said exports linked to artificial intelligence technology, renewable energy and automobiles had helped offset trade disruption and high energy prices connected to the Middle East war.

Dan Wang of Eurasia Group said the economy had held up against energy and supply chain disruption, but weaker global demand was hurting lower-end consumer goods and smaller exporters. She said AI-related and renewable energy industries performed strongly.

Sheana Yue of Oxford Economics said external demand continued to outperform despite tariffs and geopolitical uncertainty. But she said exports were compensating for weak domestic demand and subdued business and household sentiment.

Official data showed overseas shipments rose 19.4% year on year in May. Retail sales fell in May for the first time in three years, while fixed-asset investment also slowed, according to official data cited in the item.

Analysts said further support measures may be needed later in the year, especially if the AI-driven export wave weakens. Trade frictions with the United States and European Union remain a risk for Chinese exporters.